EXHIBIT 4.3
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REGISTRATION RIGHTS AGREEMENT
May 10, 1999
Dear Sir/Madam:
Pursuant to the Agreement and Plan of Merger Reorganization dated as of
April 15, 1999 (the "MERGER AGREEMENT"), among Excel Switching Corporation (the
"COMPANY"), Racepoint Acquisition Corporation, a subsidiary of the Company
("MERGER SUB"),RAScom, Inc. ("TARGET") and the other parties named herein,
Merger Sub is being merged with and into Target. In connection therewith, as one
of the holders (the "HOLDERS") of Common Stock of Target, you are acquiring
shares of Common Stock of the Company. As context requires, a Holder may be
referred to as a "SELLER". In connection with the transaction, the Company and
you covenant and agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"COMMISSION" shall mean the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.
"COMMON SHARES" shall mean the shares of Common Stock of the Company
issued to the Holders pursuant to the Merger Agreement.
"COMMON STOCK" shall mean the Common Stock, $.01 par value, of the
Company, as constituted as of the date of this Agreement.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of
the Commission thereunder, all as the same shall be in effect at the time.
"REGISTRATION EXPENSES" shall mean the expenses so described in Section
8.
"RESTRICTED STOCK" shall mean the Common Shares, excluding Common
Shares which have been (a) registered under the Securities Act pursuant to
an effective registration statement filed thereunder and disposed of in
accordance with the registration statement covering them, (b) sold
pursuant to Rule 144 under the Securities Act or (c) transferred in a
transaction in which the seller's rights and obligations under this
Agreement were not assigned in accordance with this Agreement.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or
any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"SELLING EXPENSES" shall mean the expenses so described in Section 8.
2. COMPLIANCE WITH SECURITIES LAWS. You represent and warrant that:
(a) You are acquiring the Common Shares to be issued to you
solely in exchange for the shares of capital stock of Target owned by you or
otherwise issuable to you by Target in connection with the transactions
contemplated by the Merger Agreement.
(b) You have paid no brokerage or similar commissions in
connection with the acquisition of such Common Shares.
(c) You are acquiring such Common Shares solely for your
account.
(d) You have provided such information as may reasonably have
been requested by the Company in order for the Company or its counsel to
evaluate the availability of an exemption under the Securities Act for the
issuance of Company Stock to you.
(e) Subject to applicable community property laws, you are the
lawful owner of the shares of Target Common Stock to be exchanged for shares of
the Company's Common Stock pursuant to the Merger Agreement and have good and
clear title to such shares, free of all restrictions on transfer, liens,
encumbrances, security interests and claims whatsoever.
3. SECURITIES ACT MATTERS. You acknowledge and agree that the Common
Shares to be issued to you have not been (and at the time of acquisition by you,
will not have been) registered under the Securities Act or under the securities
laws of any state, in reliance upon certain exemptive provisions of such
statutes. You recognize and acknowledge that such claims of exemption are based,
in part, upon your representations contained in this Agreement. You further
recognize and acknowledge that, because the Common Shares are unregistered under
federal and state laws, they are not presently eligible for public resale, and
may only be resold in the future pursuant to an effective registration statement
under the Securities Act and any applicable state securities laws, or pursuant
to a valid exemption from such registration requirements. You recognize and
acknowledge that Rule 144 promulgated under the Securities Act (which
facilitates routine sales of securities in accordance with the terms and
conditions of that Rule, including a holding period requirement) is not now
available to you for resale of the Common Shares, and you recognize and
acknowledge that, in the absence of the availability of Rule 144, a sale
pursuant to a claim of exemption from registration under the Securities Act
would require compliance with some other exemption under the Securities Act,
none of which may be available for resale of the Common Shares by you. You
recognize and acknowledge that, except as set forth in this Agreement, the
Company is under no obligation to register the Common Shares, either pursuant to
the Securities Act or the securities laws of any state.
4. RESTRICTIVE LEGEND. Each certificate representing Common Shares
shall, except as otherwise provided in this Section 4 or in Section 5, be
stamped or otherwise imprinted with a legend substantially in the following
form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 AND MAY NOT BE TRANSFERRED OR
OTHERWISE DISPOSED OF UNLESS IT HAS BEEN REGISTERED UNDER THAT ACT
OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. THE HOLDER OF THIS
SECURITY IS ENTITLED TO CERTAIN REGISTRATION RIGHTS SET FORTH IN A
REGISTRATION RIGHTS AGREEMENT DATED MAY 10, 1999, A COPY OF WHICH
MAY BE OBTAINED FROM THE CLERK OF THE CORPORATION."
Such certificates shall not bear the above legend if in the opinion of counsel
satisfactory to the Company the securities being sold thereby may be publicly
sold without registration under the Securities Act or if such securities have
been sold pursuant to Rule 144 or an effective registration statement.
5. NOTICE OF PROPOSED TRANSFER. Prior to any proposed transfer of any
Common Shares, the holder thereof shall give written notice to the Company of
its intention to effect such transfer. Each such notice shall describe the
manner of the proposed transfer and, if requested by the Company, shall be
accompanied by an opinion of counsel satisfactory to the Company to the effect
that the proposed transfer may be effected without registration under the
Securities Act, whereupon the holder of such security shall be entitled to
transfer such security in accordance with the terms of its notice; provided,
however, that no prior notice or opinion of counsel shall be required if the
sale is made in compliance with Rule 144 or if such transfer is to one or more
partners of the transferor (in the case of a transferor that is a partnership).
Each certificate for Common Shares transferred as above provided shall bear the
legend set forth in Section 4, except that such certificate shall not bear such
legend if (i) such transfer is in accordance with the provisions of Rule 144 (or
any other rule permitting public sale without registration under the Securities
Act) or (ii) the opinion of counsel referred to above is to the further effect
that the transferee and any subsequent transferee (other than an affiliate of
the Company) would be entitled to transfer such securities in a public sale
without registration under the Securities Act. The restrictions provided for in
this Section 5 shall not apply to securities which are not required to bear the
legend prescribed by Section 4 in accordance with the provisions of that
Section.
6. REGISTRATION.
(a) Shelf Registration. (i) The Company agrees to cause a
registration statement under the Securities Act on Form S-3 relating to up to
fifty percent (50%) of the shares of Common Stock issued to each Holder pursuant
to the Merger Agreement to be filed within sixty (60) days after the Closing
Date (as defined in the Merger Agreement) and shall use all commercially
reasonable efforts to cause such registration statement to be declared effective
by the Commission on, or as expeditiously as possible after, the publication by
the Company of financial results including at least thirty (30) days
post-Closing combined results of operations of the Company and Target, subject
to and in accordance with Section 7 hereof.
(ii) The Company agrees to cause a registration statement
under the Securities Act on Form S-3 relating to the remaining fifty percent
(50%) of the shares of Common Stock issued to each Holder pursuant to the Merger
Agreement to be filed within one year after the Closing Date, and shall use all
commercially reasonable efforts to cause such registration statement to be
declared effective by the Commission as expeditiously as possible, and to
maintain the effectiveness of such registration statement for at least nine
months thereafter.
(b) Piggyback Registration Rights. On one occasion between the
first and second anniversary of the Closing Date, each holder of Restricted
Stock shall have the right to have his, her or its shares of Restricted Stock
included for sale on any registration statement filed by the Company, except
registration statements filed on Form S-4 and Form S-8 or their successor forms
or any other form which does not permit registration of the Restricted Stock, at
the Company's cost and expense (except commissions or discounts and fees of the
holder's own professionals, if any); provided, however, that this provision
shall not apply to any shares of Restricted Stock that may, at the time of
filing of such Company registration statement, be sold within any three-month
period under Rule 144 of the Act. If the offering with respect to which a
registration statement is filed is managed by an independent underwriter, and if
in the reasonable judgment of the managing underwriter, the sale of shares of
Restricted Stock in connection with the proposed offering would have a material
adverse effect on the offering, then the number of shares of Restricted Stock to
be sold by stockholders of the Company may be reduced and cut back, pro rata
with other Holders who propose to sell shares in the offering; provided,
however, that management of the Company shall have priority in the event of any
cut-back. The Company shall give the Holder ten (10) business days notice of the
intended filing date of any registration statement, other than a registration
statement filed on Form S-4 or Form S-8 or any successor form, and the Holder
shall have one week after receipt of such notice to notify the Company of its
intent to include any shares of Restricted Stock in such registration statement.
7. REGISTRATION PROCEDURES. In using its efforts to effect the
registration of any shares of Restricted Stock under the Securities Act as
described in Section 6, the Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration
statement on Form S-3 with respect to such securities as specified in Section 6
above and use its commercially reasonable efforts to cause such registration
statement to become effective as soon as reasonably practicable thereafter and
to remain effective until the earlier of the sale of all Restricted Stock
covered thereby or one year after the Closing Date, provided, however, that the
Company may delay the filing or effectiveness of such registration statement or
suspend sales at any time under the registration statement immediately upon
notice to the undersigned at the last known address of the undersigned, for a
period or periods of time not to exceed in the aggregate 90 days during any
12-month period, if there then exists material, non-public information relating
to the Company which, in the reasonable opinion of the Company, would not be
appropriate for disclosure during that time. Moreover, anything herein to the
contrary notwithstanding, the Company shall not be required to take any action
to cause the registration statement to be declared effective by the Commission
at any time prior to the publication by the Company of financial results
including at least thirty (30) days' post-Closing combined results of operations
of the Company and Target;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be
necessary to keep such registration statement effective until the earlier of the
sale of all Restricted Stock covered thereby or the first anniversary of the
Closing Date;
(c) furnish to each seller of Restricted Stock such number of
copies of the registration statement and each such amendment and supplement
thereto (in each case including exhibits) and the prospectus included therein
(including each preliminary prospectus) as such persons reasonably may request
in order to facilitate the public sale or other disposition of the Restricted
Stock covered by such registration statement;
(d) use its commercially reasonable efforts to register or
qualify the Restricted Stock covered by such registration statement under the
securities or "blue sky" laws of such jurisdictions as the sellers of Restricted
Stock reasonably shall request, provided, however, that the Company shall not
for any such purpose be required to qualify generally to transact business as a
foreign corporation in any jurisdiction where it is not so qualified or to
consent to general service of process in any such jurisdiction;
(e) use its commercially reasonable efforts to have the
Restricted Stock covered by such registration statement approved for listing and
subject to quotation on the Nasdaq National Market;
(f) notify each seller of Restricted Stock under such
registration statement (at any time when a prospectus relating thereto is
required to be delivered under the Securities Act), of the happening of any
event of which the Company has knowledge as a result of which the prospectus
contained in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing, and promptly prepare and furnish to
such seller a reasonable number of copies of a prospectus supplemented or
amended so that, as thereafter delivered to the purchasers of such Restricted
Stock, such prospectus shall not include an untrue statement of material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances then
existing; and
(g) furnish, at the request of any Holder requesting
registration of Restricted Stock, on the date that such Restricted Stock is
delivered to the underwriters for sale in connection with a registration
pursuant to this Agreement if such securities are being sold through
underwriters, (i) an opinion, dated such date, of the counsel representing the
Company for the purposes of such registration, in form and substance as is
customarily given to underwriters in an underwritten public offering, addressed
to the underwriters, if any, and (ii) a letter dated such date, from the
independent certified public accountants of the Company, in form and substance
as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriters,
if any.
If the Company shall determine in its discretion that it is in the best
interest of the Company to effect distribution by means of an underwriting, the
Company shall promptly notify each seller of such determination. In such event,
the right of any seller to participate in such distribution shall be conditioned
upon such seller's agreement to enter into a written agreement
with the managing underwriter in such form and containing such provisions as are
customary in the securities business for such an arrangement between such
underwriter and companies of the Company's size and investment stature.
8. EXPENSES. All expenses incurred by the Company in complying with
Sections 6 and 7, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses incurred in connection
with complying with state securities or "blue sky" laws, fees of the National
Association of Securities Dealers, Inc., transfer taxes, fees of transfer agents
and registrars, and costs of issuance, but excluding any Selling Expenses, are
called "REGISTRATION EXPENSES". All fees and expenses of counsel to the sellers,
underwriting discounts (if any) and selling commissions applicable to the sale
of Restricted Stock are called "SELLING EXPENSES".
The Company will pay all Registration Expenses in connection with a
registration statement on Form S-3 under Section 6. All Selling Expenses in
connection with any registration statement under Section 6 shall be borne by the
participating sellers in proportion to the number of shares sold by each and
each seller shall be responsible for the fees and expenses of his, her or its
own counsel. The Company shall not be obligated to pay any Registration Expenses
in connection with the registration statement under Section 6 if such
registration statement is withdrawn, delayed or abandoned for any reason by the
sellers.
9. INDEMNIFICATION AND CONTRIBUTION.
(a) In connection with the registration of the Restricted
Stock under the Securities Act pursuant to Section 6, the Company will indemnify
and hold harmless each seller of such Restricted Stock thereunder, its officers
and directors, each underwriter of such Restricted Stock thereunder and each
other person, if any, who controls such seller or underwriter within the meaning
of the Securities Act, against any losses, claims, damages or liabilities, joint
or several, to which such seller, officer, director, underwriter or controlling
person may become subject under the Securities Act, Exchange Act, state
securities laws or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of material fact contained in
the registration statement under which such Restricted Stock was registered
under the Securities Act pursuant to Section 6, any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereto, (ii)
the omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading or (iii) any
violation by the Company or its agents of any rule or regulation promulgated
under the Securities Act, Exchange Act or state securities laws applicable to
the Company or its agents and relating to action or inaction required of the
Company in connection with such registration, and the Company will reimburse
each such seller, each such officer and director, each such underwriter and each
such controlling person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim, damage,
liability or action, provided, however, that the Company will not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission so made in reliance
upon and in conformity with information furnished by any such seller in writing,
any such underwriter or any such controlling person.
(b) In connection with the registration of the Restricted
Stock under the Securities Act pursuant to Section 6, each seller of such
Restricted Stock thereunder, severally and not jointly, will indemnify and hold
harmless the Company, each person, if any, who controls the Company within the
meaning of the Securities Act, each officer of the Company who signs the
registration statement, each director of the Company, each underwriter and each
person who controls any underwriter within the meaning of the Securities Act,
against all losses, claims, damages or liabilities, joint or several, to which
the Company or such officer, director, underwriter or controlling person may
become subject under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon (i) the failure of such seller to comply with the provisions of
Section 12 herein or (ii) any untrue statement or alleged untrue statement of
any material fact contained in the registration statement, any preliminary
prospectus or final prospectus contained therein, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse the Company and each
such officer, director, underwriter and controlling person for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action, provided, however,
that such seller will be liable hereunder in any such case if and only to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in reliance upon and in conformity with information pertaining to
such seller, and furnished in writing by or on behalf of such seller.
(c) Promptly after receipt by an indemnified party hereunder
of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party hereunder,
notify the indemnifying party in writing thereof, but the omission so to notify
the indemnifying party shall not relieve it from any liability which it may have
to such indemnified party other than under this Section 9 and shall only relieve
it from any liability which it may have to such indemnified party under this
Section 9 if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake the
defense thereof and the approval by the indemnified party of the counsel chosen
by the indemnifying party, the indemnifying party shall not be liable to such
indemnified party under this Section 9 for any legal expenses subsequently
incurred by such indemnified party in connection with the defense thereof other
than reasonable costs of investigation and of liaison with counsel so selected,
provided, however, that, if the defendants in any such action include both the
indemnified party and the indemnifying party and if the interests of the
indemnified party reasonably may be deemed to conflict with the interests of the
indemnifying party, the indemnified party shall have the right to select a
separate counsel and to assume such legal defenses and otherwise to participate
in the defense of such action, with the
expenses and fees of such separate counsel and other expenses related to such
participation to be reimbursed by the indemnifying party as incurred.
(d) In order to provide for just and equitable contribution to
joint liability in any case in which either (i) any holder of Restricted Stock
exercising rights under this Agreement, or any controlling person of any such
holder, makes a claim for indemnification pursuant to this Section 9 but it is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that this Section 9 provides for indemnification in
such case, or (ii) contribution under the Securities Act may be required on the
part of any such selling holder or any such controlling person in circumstances
for which indemnification is provided under this Section 9; then, and in each
such case, the Company and such holder will contribute to the aggregate losses,
claims, damages or liabilities to which they may be subject (after contribution
from others) in proportion to the relative fault of the Company, on the one
hand, and each holder, severally, on the other hand; provided, however, that, in
any such case, no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation, and further provided, that in no event shall the liability of
such holder for contribution hereunder exceed the amount for which such holder
would have been liable if Section 9(b) above were determined to be enforceable.
(e) The indemnities provided in this Section 10 shall survive
the transfer of any Restricted Stock by such holder.
10. REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view to
making available to the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation thereunder that may at any time
permit a Holder to sell securities of the Company to the public without
registration, the Company agrees to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144;
(b) maintain registration of its Common Stock under Section 12
of the Exchange Act;
(c) file in a timely manner all reports and other documents
required of the Company under the Securities Act and the Exchange Act; and
(d) furnish to any Holder, so long as the Holder owns any
Restricted Securities, forthwith upon request: (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144, (ii) a
copy of the most recent annual or quarterly report of the Company and such other
reports and documents so filed by the Company; and (iii) such other information
as may be reasonably requested in availing any Holder of any rule or regulation
under the Securities Act which permits the selling of any such securities
without registration or pursuant to such form.
11. CHANGES IN COMMON STOCK. If, and as often as, there is any change
in the Common Stock by way of a stock split, stock dividend, combination or
reclassification, or through a merger, consolidation, reorganization or
recapitalization, or by any other means, appropriate adjustment shall be made in
the provisions hereof so that the rights and privileges granted hereby shall
continue with respect to the Common Stock as so changed.
12. SELLERS' CONDUCT. With respect to any sale of Common Shares
pursuant to Section 6, you understand and agree as follows:
(a) You will carefully review the information concerning you
contained in the registration statement (if any) and will promptly notify the
Company if such information is not complete and accurate in all respects,
including having properly disclosed any position, office or other material
relationship within the past three years with the Company, Target or their
affiliates;
(b) You agree to sell your Common Shares only in the manner
set forth in the registration statement and agree to comply with the
anti-manipulation rules under the Exchange Act in connection with purchases and
sales of securities of the Company during the time the registration statement
remains effective
(c) You agree to comply with the prospectus delivery
requirements of the Exchange Act;
(d) You agree to promptly notify the Company of any and all
planned sales and completed sales of shares; and
(e) You agree to suspend sales during the periods when sales
are required to be suspended pursuant to Section 7(a) herein.
(f) In connection with each registration hereunder, you agree
to furnish to the Company in writing such information requested by the Company
with respect to yourself and the proposed distribution by you as shall be
necessary in order to assure compliance with federal and applicable state
securities laws.
13. MISCELLANEOUS.
(a) All covenants and agreements contained in this Agreement
by or on behalf of any of the parties hereto shall bind and inure to the benefit
of the respective successors and assigns of the parties hereto (including
without limitation transferees of any Restricted Stock, provided, that such
transferee executes a counterpart signature page to this Agreement), whether so
expressed or not.
(b) All notices, requests, consents and other communications
hereunder shall be in writing and shall be delivered by first class mail,
postage prepaid, by overnight courier or by electronic facsimile or telex and
addressed as follows:
If to the Company, at:
Excel Switching Corporation
000 Xxxxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxxxxxx Xxxxxxx
General Counsel
If to any other party hereto, at the address of such party set
forth on the signature page hereto;
If to any subsequent holder of Restricted Stock, to it at such
address as may have been furnished to the Company in writing by
such holder;
or, in any case, at such other address or addresses as shall have been furnished
in writing to the Company (in the case of a holder of Restricted Stock) or to
the holders of Restricted Stock (in the case of the Company) in accordance with
the provisions of this paragraph.
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
(d) This Agreement may be amended or modified, and provisions
hereof may be waived, with the written consent of the Company and the Holders of
at least a majority of the shares of Restricted Stock outstanding at the time of
such amendment, modification or waiver.
(e) This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(f) If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
(g) Without the prior written consent of the Company, the
registration rights set forth in this Agreement are not transferable except to a
trust or other estate planning entity created for the benefit of any seller or
their immediate family members. Such consent may be granted or denied at the
Company's sole discretion. All transferees must agree in writing to be bound by
all the provisions of this Agreement.
14. REPRESENTATIONS AND COVENANTS. You hereby represent and warrant to
the Company as follows:
(a) YOU UNDERSTAND THAT YOUR INVESTMENT IN THE SECURITIES
INVOLVES RISK.
(b) YOU HAVE CONSULTED YOUR OWN ATTORNEY, ACCOUNTANT OR
INVESTMENT ADVISOR WITH RESPECT TO THE INVESTMENT CONTEMPLATED HEREBY AND ITS
SUITABILITY FOR YOU. ANY SPECIFIC ACKNOWLEDGMENT SET FORTH BELOW WITH RESPECT TO
ANY STATEMENT OR INFORMATION FURNISHED TO YOU SHALL NOT BE DEEMED TO LIMIT THE
GENERALITY OF THIS REPRESENTATION AND WARRANTY.
(c) The Company has made available to you, during the course
of this transaction and prior to the acquisition of the Company Common Stock
(collectively, and hereinafter referred to as, the "SECURITIES"), the
opportunity to ask questions of and receive complete and correct answers from
representatives of the Company concerning the terms and conditions of the
Securities and to obtain any additional information relating to the financial
condition and business of the Company.
(d) You understand that you must bear the economic risk of
this investment until such time as the Securities are registered; that the
Securities are not currently registered under the Securities Act, and,
therefore, cannot be resold unless they are subsequently registered under the
Securities Act or unless an exemption from such registration is available; that
you are purchasing the Securities for investment for your account and not with
any present view toward resale or other distribution thereof; that you agree not
to resell or otherwise dispose of all or any part of the Securities, except as
permitted by law, including, without limitation, any and all applicable
provisions of the Merger Agreement and this Agreement and any regulations under
the Securities Act and applicable state securities laws; that except as provided
in the Merger Agreement and this Agreement, the Company is under no obligation
to register the Securities under the Securities Act or any state securities law
or to supply the information which may be necessary to enable you to sell the
Securities; and that Rule 144 under the Securities Act is not now available as a
basis for exemption from registration of any Securities hereunder.
(e) You have adequate means of providing for your current
needs and personal contingencies and have no need for liquidity in connection
with this investment in the Securities.
(f) Your overall commitment to investments which are not
readily marketable is not disproportionate to your net worth and your investment
in the Securities will not cause such overall commitment to become excessive.
The acquisition of the Securities by you is consistent with your general
investment objectives.
(g) You received an offer concerning the Securities and first
learned of this investment in the state or other jurisdiction listed in the
residence address on the signature page
hereto, and intend that the state securities laws of that state or other
jurisdiction alone govern this transaction.
(H) IF YOU ARE NOT AN ACCREDITED INVESTOR (AS DEFINED IN RULE
501(A) UNDER THE SECURITIES ACT AND AS DETAILED IN "ITEM IV. ACCREDITED INVESTOR
STATUS" AS SET FORTH ON PAGE 16 OF THIS AGREEMENT) YOU HEREBY APPOINT XXXX
XXXXXX AS YOUR PURCHASER REPRESENTATIVE FOR PURPOSES OF EVALUATING THE MERITS
AND RISKS OF INVESTING IN THE SECURITIES. IF YOU CHOOSE NOT TO APPOINT XXXX
XXXXXX AS YOUR PURCHASER REPRESENTATIVE, PLEASE CHECK THE APPROPRIATE BOX ON THE
SIGNATURE PAGE (PAGE 13) OF THIS AGREEMENT AND HAVE YOUR PURCHASER
REPRESENTATIVE COMPLETE APPENDIX A. ALONE OR TOGETHER WITH YOUR PURCHASER
REPRESENTATIVE, YOU HAVE SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS
MATTERS THAT YOU ARE CAPABLE OF EVALUATING THE MERITS AND RISKS OF THE
INVESTMENT IN THE SECURITIES AND YOU HAVE EVALUATED THE MERITS AND RISKS OF
INVESTING IN THE SECURITIES, AND HAVE DETERMINED THAT THE SECURITIES ARE A
SUITABLE INVESTMENT FOR YOU.
(i) You hereby acknowledge receipt of the documents described
in Section 3.5 of the Merger Agreement which documents you have (alone or
together with your purchaser representative) reviewed. You acknowledge and
warrant that any exhibits to these documents which were not directly furnished
to you have been made available to you, at your request, prior to consummation
of the transactions contemplated by the Agreement. You further acknowledge and
warrant that, prior to the execution of this Agreement, you have had the
opportunity to ask questions and receive answers from the Company and Target
concerning the terms and conditions of the transactions contemplated by the
Merger Agreement and the issuance of the Securities, and concerning any of the
documents identified above, and to obtain such additional further information
from the Company and Target as you have deemed necessary to verify the accuracy
of the information contained in the documents identified above or any other
information furnished to you.
(j) You understand that the representations, warranties and
covenants set forth herein will be relied upon by Target, other stockholders of
Target, the Company, stockholders of the Company and their respective counsel
and accounting firms.
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this Agreement
shall be a binding agreement between the Company and you. You understand that
the Company is expressly relying on the accuracy of the information contained
herein. By signing and returning this letter, you are representing and
warranting that the foregoing information is complete and correct as of the date
hereof. You hereby undertake to promptly notify the Company of any change in the
above information prior to investment in the Company.
Very truly yours,
EXCEL SWITCHING CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Title: President and Chief Executive Officer
--------------------------------------
AGREED TO AND ACCEPTED as of the date first above written.
Name of Seller:
------------------------
Name of Person Signing:
----------------
Signature:
-----------------------------
YOU MUST ANSWER THE FOLLOWING:
1. SELLER IS AN ACCREDITED INVESTOR (AS DEFINED IN RULE 501(A) UNDER THE
SECURITIES ACT AND AS DETAILED IN "ITEM IV. ACCREDITED INVESTOR STATUS" AS
SET FORTH ON PAGE 16 OF THIS AGREEMENT)?
[ ] Yes [ ] No
IF YOU ANSWERED "YES" PLEASE COMPLETE THE BLUE PAGES.
IF YOU ANSWERED "NO" PLEASE ANSWER QUESTION NO. 2.
2. SELLER HEREBY WISHES TO APPOINT A PURCHASER REPRESENTATIVE OTHER THAN XXXX
XXXXXX?
[ ] Yes [ ] No
IF YOU ANSWERED "NO", PLEASE COMPLETE ONLY THE BLUE PAGES.
IF YOU ANSWERED "YES", PLEASE COMPLETE THE BLUE PAGES AND HAVE YOUR
DESIGNATED PURCHASER REPRESENTATIVE COMPLETE THE YELLOW PAGES AND RETURN
THEM WITH THIS COMPLETED SIGNATURE PAGE.
I. GENERAL INFORMATION
(1) Principal Residence Address:
-----------------------------------------------------
(Number and Street)
----------------------------------------------Note: Non-principal residence
(City, State) (Zip Code) addresses and post
office boxes cannot be
accepted.
--------------------------------------
(Residence Telephone)
(2) Mailing Address (if different from above)
------------------------------------------------------
(Number and Street)
---------------------------------------
(City, State) (Zip Code)
(3) Age:
------------------------------
(4) Citizenship:
-------------------------------
(5) Social Security or Taxpayer I.D. No.:
-----------------------------------
(6) Occupation or Nature of Business:
--------------------------------------------------------------------------
--------------------------------------------------------------------------
II. INVESTMENT KNOWLEDGE AND EXPERIENCE
(1) The frequency of my investments in marketable securities has been
( ) often; ( ) occasional; ( ) seldom; ( ) never.
(2) The frequency of my investments in private offerings of securities has
been ( ) often; ( ) occasional; ( ) more than once; ( ) never.
(3) My private offering investment experience during the past five years
consists of the following:
ACTIVITY OF VENTURE
(E.G., EQUIPMENT LEASING, REAL AMOUNT OF ORIGINAL
NAME OF VENTURE ESTATE, OIL AND GAS) INVESTMENT
--------------------- ---------------------------------- ----------------------
--------------------- ---------------------------------- ----------------------
--------------------- ---------------------------------- ----------------------
--------------------- ---------------------------------- ----------------------
--------------------- ---------------------------------- ----------------------
(4) Investment Experience.
I have made investments, or been involved in activities, of the type
indicated below in the past five years (recognizing that the types of
investments listed are not mutually exclusive and certain investments
may fall into one or more of the categories listed below):
____ (a) Real estate partnerships
____ (b) Research and development partnerships
____ (c) Mutual funds
____ (d) Start-up or early stage corporations
____ (e) Venture capital investments
____ (f) Stocks
____ (g) Bonds, government obligations and other fixed income
securities
Please describe any other investments:
------------------------
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
(5) The total investments of ALL investments indicated in Item (4) above
were in excess of (indicate highest applicable amount):
[ ] $ 50,000 [ ] $250,000
[ ] $150,000 [ ] $500,000
(6) The amount indicated in Item (4) above includes TOTAL investments in
start-up or early stage corporation in excess of (indicate highest
applicable amount):
[ ] $ 25,000 [ ] $100,000
[ ] $ 50,000 [ ] over $150,000
III. INCOME AND NET WORTH
(1) The following represents my gross income from all sources (excluding the
gross income, if any, of my spouse) calculated by taking into account my
individual gross income (as reported or to be reported on my income tax
return) increased by any deduction for long term capital gain, any
deduction for depletion, any exclusion for interest and any losses of a
partnership allocated to me. [PLEASE CHECK ONE BOX FOR EACH YEAR]
1997 Actual [ ] $150,000 - 200,000 [ ] $200,000 + [ ] $__________ (fill in)
1998 Actual [ ] $150,000 - 200,000 [ ] $200,000 + [ ] $__________ (fill in)
1999 Estimated [ ] $150,000 - 200,000 [ ] $200,000 + [ ] $__________ (fill in)
(2) My total personal net worth (including the net worth, if any, of my
spouse), valuing my personal residence at its fair market value (less
encumbrances) is now estimated at: [PLEASE CHECK ONE]
[ ] $ 50,000 - $ 100,000 [ ] $ 100,000 - $250,000 [ ] $250,000 - $500,000
[ ] $500,000 - $1,000,000 [ ] $1,000,000 + [ ] $____________ (fill in)
(3) My personal net worth (exclusive of homes, home furnishings and
automobiles) is now estimated at: [PLEASE CHECK ONE]
[ ] $ 50,000 - $ 100,000 [ ] $ 100,000 - $250,000 [ ] $250,000 - $500,000
[ ] $500,000 - $1,000,000 [ ] $1,000,000 + [ ] $____________ (fill in)
IV. ACCREDITED INVESTOR STATUS
Please indicate which category below, if any, describes you:
______1. A natural person whose net worth, either individually or jointly with
such person's spouse, at the time of his purchase, exceeds $1,000,000.
______2. A natural person who had individual income in excess of $200,000, or
joint income with that person's spouse in excess of $300,000, in 1997 and 1998
and reasonably expects to reach the same income level in 1999.
______3. An entity in which all of the equity owners are described in one or
more of the categories set forth in paragraphs 1 and 2 above.
AGREED TO AND ACCEPTED as of the
date first above written.
Name of Seller: Xxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxx X. Xxxxxx
----------------------------------------
Name of Seller: Xxxxx X. Xxxxxx
Xxxxxx Xxxxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxxxx
/s/ Xxxxxx Xxxxxx
----------------------------------------
Name of Seller: Xxxxx X. Xxxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxxx
----------------------------------------
Name of Seller: Xxxxx X. Xxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name of Seller: X.X. Xxxx
-----------------------------------
Signature: /s/ X.X. Xxxx
----------------------------------------
Name of Seller: Xxxxxxx River Partnership VII
-----------------------------------
Signature: /s/ Xxxxxxx Xxx (General Partner)
----------------------------------------
Name of Seller: Xxxxx Xxxxxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Los
-----------------------------------
Signature: /s/ Xxxxxx X. Los
----------------------------------------
FIRST ALBANY CORPORATION
CUSTODIAN FBO XXXXX X. XXXXXXXX XXX
Name of Seller: First Albany Corporation Custodian
FBO Xxxxx X. Xxxxxxxx XXX
-----------------------------------
Signature: /s/ Xxxxxxx Xxxxxx (Supervisor)
----------------------------------------
Signature: /s/ Xxxxx Xxxxxxx (Guarantor)
----------------------------------------
Name of Seller: Xxxxxxxx Xxxxx
-----------------------------------
Signature: /s/ Xxxxxxxx Xxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Name of Seller: Xxxxxxx X. Xxxxxxx
-----------------------------------
Signature: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------------
Name of Seller: HarbourVest Partners V - Direct Fund
L.P.
-----------------------------------
By: HVP V - Direct Associates L.L.C.
Its: General Partner
By: HarbourVest Partners, LLC
Its: Managing Member
Signature: /s/ Xxxx Xxxxxxxxxx (Managing Director)
----------------------------------------
Name of Seller: Xxxxx Xxxxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxxxx
----------------------------------------
Name of Seller: InterStock Anstalt
-----------------------------------
Signature: /s/ Xxxxx Xxxxxxxx (Director)
/s/ Xxxxx Xxxxxx (Director)
----------------------------------------
Name of Seller: Xxxxx X. Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Name of Seller: Xxxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name of Seller: Xxxxxxx Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxxx Xxxxxx
----------------------------------------
Name of Seller: Xxxxxxx X. Xxxxx
-----------------------------------
Signature: /s/ Xxxxxxx X. Xxxxx
----------------------------------------
Name of Seller: Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxxx
/s/ Xxxxxxx X. Xxxxx
----------------------------------------
Name of Seller: Xxxxx Xxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxx
----------------------------------------
Name of Seller: Xxxxxxxx X. Xxxx
-----------------------------------
Signature: /s/ Xxxxxxxx X. Xxxx
----------------------------------------
Name of Seller: Le Serre
-----------------------------------
Signature: /s/ Xxxxx Xxxxxxxx (Partner)
----------------------------------------
Name of Seller: Xxxxx Xxxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxxx
----------------------------------------
Name of Seller: Xxxxx Xxxxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxxxx
----------------------------------------
Name of Seller: Xxxxxx Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxx Xxxxxx
----------------------------------------
Name of Seller: Xxxxx Xxx
Xxxxxxxx Xxx
-----------------------------------
Signature: /s/ Xxxxx Xxx
/s/ Xxxxxxxx Xxx
----------------------------------------
Name of Seller: Xxxxxxx Xxxxx
-----------------------------------
Signature: /s/ Xxxxxxx Xxxxx
----------------------------------------
Name of Seller: Xxxxxxx X. Xxxx
-----------------------------------
Signature: /s/ Xxxxxxx X. Xxxx
----------------------------------------
Name of Seller: Xxxxxxx Xxxxxx
Xxxxx X. Xxxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxxx Xxxxxx
/s/ Xxxxx X. Xxxxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name of Seller: Xxxxx Xxxxxxxxxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxxxxxxxxx
----------------------------------------
Name of Seller: Xxxxx X. Xxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxx
----------------------------------------
Name of Seller: Xxxxxx Xxxxxx
Xxxxxxx Xxxxxx
-----------------------------------
/s/ Xxxxxxx Xxxxxx
Signature: /s/ Xxxxxx Xxxxxx
----------------------------------------
Name of Seller: PCC Transfer Limited Partnership
-----------------------------------
Signature: /s/ Xxxxx Xxxxxxxx (Manager)
----------------------------------------
Name of Seller: Pioneer Ventures Limited
Partnership II
-----------------------------------
Signature: /s/ Xxxxx Xxxxxxxx (President)
----------------------------------------
Name of Seller: R. Xxxxxxx Xxxxxxx
-----------------------------------
Signature: /s/ R. Xxxxxxx Xxxxxxx
----------------------------------------
Name of Seller: Xxxx X. Xxxxxxx
-----------------------------------
Signature: /s/ Xxxx X. Xxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxxx and Xxxxx X.
Xxxxxxxx, JTWROS
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxxx
/s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
Name of Seller: Xxx Xxxxxx
-----------------------------------
Signature: /s/ Xxx Xxxxxx
----------------------------------------
Name of Seller: Xxxxx Xxxxxx
-----------------------------------
Signature: /s/ Xxxxx Xxxxxx
----------------------------------------
Name of Seller: Xxxxxx Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx Xxxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
Name of Seller: SVM Star Ventures Enterprises No. V,
a German Civil Law Partnership (with
Limitation of Liability)
-----------------------------------
By: SVM Star Ventures Managementgesellschaft
mbH Nr. 3
----------------------------------------------
Its: Managing Partner
----------------------------------------------
Signature: /s/ Xxxx Xxxxx (Managing Director)
----------------------------------------
Name of Seller: SVM Star Ventures Enterprises
No. 3 & Co. KG
-----------------------------------
By: SVM Star Ventures Managementgesellschaft
mbH Nr. 3
----------------------------------------------
Its: Managing Partner
---------------------------------------------
Signature: /s/ Xxxx Xxxxx (Managing Director)
----------------------------------------
Name of Seller: Xxxxx X. Xxxxx
-----------------------------------
Signature: /s/ Xxxxx X. Xxxxx
----------------------------------------
Name of Seller: The MHF Sylvan Fund
-----------------------------------
Signature: /s/ Xxxxxx Xxxx (Trustee)
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxxx, Xx.
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxxx, Xx.
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
WATERLINE CAPITAL, LLC
Name of Seller: Xxxxxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxxxxx X. Xxxxxx (Managing
Director
----------------------------------------
Name of Seller: Xxxxxxx Xxxxxxxx
-----------------------------------
Signature: /s/ Xxxxxxx Xxxxxxxx
----------------------------------------
Name of Seller: Xxxxxx X. Xxxxxx
-----------------------------------
Signature: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name of Seller: Xxxxxx Xxxxxx Stess Trust
-----------------------------------
Signature: /s/ Xxxxxxx Xxxxx (Trustee)
----------------------------------------
APPENDIX A - REPRESENTATIVE'S CERTIFICATE
IF YOU CHOOSE NOT TO APPOINT XXXX XXXXXX AS YOUR PURCHASER REPRESENTATIVE, YOUR
DESIGNATED PURCHASER REPRESENTATIVE MUST FILL OUT THE FOLLOWING CERTIFICATE:
Stockholder acknowledges that _____________________ will serve as
Purchaser Representative(s) in connection with evaluating the merits and risks
of his or her prospective investment in the securities offered by the Company,
and that said Representative(s) has/have previously disclosed to Stockholder, in
writing, any material relationship between the Representative(s) (or his or
their affiliates) and the Company or its affiliates that now exists or is
mutually understood to be contemplated or that has existed at any time during
the previous two years, and any compensation received or to be received as a
result of such relationship.
____________ has been named by the undersigned Stockholder as a person
upon whose advice the Stockholder has relied in evaluating the merits and risks
of investment in the Company. In connection with the proposed investment by the
Stockholder, the Purchaser Representative hereby represents and warrants as
follows:
(i) Representative is not an affiliate, director, officer or other
employee of the Company or the beneficial owner of 10% or more of any class of
equity interest in the Company;
(ii) Listed below are all material relationship (and any compensation
received or to be received by the Representative or his affiliates as a result
thereof) between the Representative (or his affiliates) and the Company or its
affiliates that now exist or have existed at any time during the past two years
or are now contemplated:
----------------------------------------------
----------------------------------------------
----------------------------------------------
(iii) Representative's educational background is as follows (please
state schools attended, degrees and years in which received):
------------- ------------- -------------
------------- ------------- -------------
------------- ------------- -------------
(iv) Representative is primarily engaged in the following business or
profession:
----------------------------------------------
----------------------------------------------
----------------------------------------------
(v) Representative has known the Stockholder for _____ years in the
following capacity:
----------------------------------------------
(vi) Representative is familiar with the financial position and plans
of the Stockholder.
(vii) Representative has previously rendered advice to the Stockholder
with respect to an investment of this type.
[ ] Yes [ ] No If "Yes", please specify:
----------------------------------------------
(viii) Representative has prior experience in advising persons with
respect to investments of a nature similar to that presently offered by the
Company.
[ ] Yes [ ] No If "Yes", please specify:
----------------------------------------------
(ix) Representative has knowledge and experience in financial and
business matters such that he is capable of evaluating, along, or together with
the Stockholder's other purchaser representatives, or together with the
Stockholder, the merits and risks of investment in the Company.
In witness whereof, the undersigned have signed this certificate as of
the _____ day of ____________, 1999.
STOCKHOLDER:
------------
Name:
-----------------------------------
(Address)
-----------------------------------
-----------------------------------
REPRESENTATIVE:
---------------
Name:
-----------------------------------
(Address)
-----------------------------------
-----------------------------------
